Article Summary
According to JP Morgan Chase,increased shipments of Chinese steel over the past two years has generated a wave of protectionism from countries around the globe.Decreasing domestic demand and slower economic growth have resulted in a large increase in steel exports from China,driving down global prices.The almost doubling of Chinese steel exports since 2013 has steel mills in areas ranging from South Africa to Europe to India to the United States pushing their governments for protectionist measures against the Chinese-produced steel.
-Refer to the Article Summary.Assume countries initially enacted protectionist measures against Chinese steel imports.If these protectionist measures were eventually eliminated,then all else equal,the price of steel in those countries would ________ and the quantity of steel demanded in those countries would ________.
A)increase;increase
B)increase;decrease
C)decrease;increase
D)decrease;decrease

Question

Quizplus · Accepted Answer

If the protectionist measures were eliminated, the price of steel in those countries would decrease, as Chinese steel exports would flood the market again. This would result in an increase in the quantity of steel demanded in those countries, as lower prices would incentivize higher consumption. Therefore, the correct choice is C: decrease; increase.

Article Summary According to JP Morgan Chase,increased Shipments of Chinese Steel Over